TheFinance.sg » Market Review and Trends

Tug of war – Bull vs. Bear Ends. Financial market plunges. What’s next

Patrick See — Tue, 22 May 2012 04:24:21 +0000

Published Singapore Monday 1pm.

The above article commenced mid February with Part 2 in March and Part 3 in April. My benchmark for the tug of war list of events is the DJI ranging from 12800 to 13000. I had picked the above title, then, is because my speculation was that market would trend sideways until the next key events.

Last week, DJI closed below 12,400 together with S&P500 and Nasdaq closing down for the week back to back. Hence, the tug of war or range trading had ended. Leading to the correction were the following list of events:

· GDP were weak then

· Currencies were lower (not USD) signalling higher inflation….

However, having provided all the bad news…. here comes my technical reading.

Technically, RSI and various indicators signal ‘oversold’ levels. The big boys, fund houses may have program buying at key technical support levels. Hence, there’s a strong possibility the market would take a short breather from these oversold positions.

Carry trades

The global sentiment is risk-off. Volatility is high. This leads to unwinding of carry trades in currencies. Hence, safe haven currencies are sought after. The Yen and US dollar rises. Other currencies including commodity currencies weaken. This leads to a fall in commodities – mining, agriculture, etc.

On a separate matter…

Properties. This is probably your biggest and longest investment. Most, if not all would take the longest tenure. Here’s the problem most of you do not see. You’ll be paying the biggest loan and let the bank earn your money. Your principal gets lowered very very slowly…

Skyscraper Curse Predicts Huge Market Draw Downs?

Drizzt — Mon, 21 May 2012 15:55:33 +0000

Now this is seldom heard of but I noticed this at Jeffrey Gundlach’s bloomberg interview where he draws the similarity of the World Trade Center Tower becoming the tallest building in New York.

Why does this matter? Apparently building of huge tall infrastructure seems to be a psychological indication of human ego at its peak and normally precedes big market draw downs.

If you think this is born out of Drizzt’s fantasy, Barclay issue a report on this as well. You can read an article on it here.

In 1929, the opening of 40 Wall Street and the Chrysler Building were harbingers of the worst-ever U.S. meltdown, the Great Depression. A year later, the Empire State Building became the world’s tallest building, presaging years of gloom.

The 1970s saw the completion of New York’s World Trade Center and Chicago’s Sears Tower. They opened amid stagflation in the U.S. …

Greece elections could trigger the "Great Stock Sale" GSS in June 2012……..what investment strategy should we adopt during these uncertain times …..

Kevin Scully — Mon, 21 May 2012 03:35:00 +0000

Greece elections could trigger the “Great Stock Sale” GSS in June 2012……..what investment strategy should we adopt during these uncertain times …..
Monday, 21 May, 2012 11:35 AM
Posted by Kevin Scully

Last Friday, I was invited by Lim & Tan to do an investment presentation on the Investment Strategies for the Singapore market in 2012. The slides can be downloaded from our website.

The key messages during my talk were:

a) the problems in the EU would take many years to resolve and we are likely to see problems surfacing from individual members of the EU every now and then – bottom line – more market volatility in the months ahead

b) if you cannot stomach the volatility than shift about 50% of your portfolio into defensive yield plays. I also provided a list of yield stocks or investments that investors can look at for the …

Why you should invest during a market downturn?

financiallyfreenow — Mon, 21 May 2012 02:00:00 +0000

The stock markets have once again gone into panic mode. Investors are fearful of a Greece exit from the Euro and are dreading the repercussions it will bring. With such fear in the markets and dropping prices, opportunities are once again presented to those who have a long-term view of the stock market.

Below is something I did up in Excel to show how much one can gain by buying stocks at depressed prices. Please be reminded that this only works if you buy fundamentally strong companies with good cash flow, low debts and good industry prospects.

If a stock is down 10%, a gain back to break-even point is a 11.1% gain bagged. For example, a stock drops from $1 to $0.90 (a decrease of 10% from purchase …

Portfolio riding market cycles of Bull and Bear

Createwealth8888 — Sat, 19 May 2012 05:57:00 +0000

How bad will the portfolio value fall this time?

STI down -8.2% from its recent peak at 3,026 in 65 days?

Where is STI’s Investor emotion in this cycle now?

Fear or depression???

Financial May-hem

Lau — Mon, 14 May 2012 23:32:00 +0000

May is the month for mother’s day so first and foremost, Happy Mom’s Day!

On the financial front, May 2012 seems to be an eventful month for the Euro zone. A new French leader has been elected in power who threatens to ratify the financial treaty due to growing dissent from the population because of the austerity measures. This was followed by Greece difficulty in forming a coalition. Even Bank of England is keeping interest rates to their near zero range.

One thing financial markets dislike is uncertainty. Rule of thumb is that uncertainty carries risk and with increased risk, a higher premium is required to take on more of it. With the road ahead unclear, and the summer holidays approaching, believe most would look towards taking their bets off the table.

This reminds me of a recent term that has attracted a lot of hype, “known unknowns”. These known …

Bookmakers call it off on Greece exit!!!

Sat, 12 May 2012 12:13:00 +0000

I’ve come across this interesting article on bookmakers across the Euro region on the betting for Greece exit. I already have an account with Betfair which I have used to bet on soccer rather than political regime betting. So do you have an account with them? :p

Bookmakers in Britain have suspended all bets; if Greece, will be leaving the eurozone due to the current political upheaval in the country.

William Hill and Ladbrokes have suspended all bets on whether Greece will be leaving the eurozone. Betting on William Hill had increased on Greece leaving the eurozone that it had been deemed to risky to continue taking new bets. The odds had actually been pushed to down to a quarter. The increased bets on whether Greece will be leaving were attributed to the fact that the country is having political troubles, after leaders in Greece were unable to form any …

Sugar Business : Opportunity Strikes Again

Dave — Sat, 12 May 2012 02:15:48 +0000

Smart Passive Cash Flow Presents another opportunity For Sugar Business.

My views on Singapore’s low birth rate

Greatsage — Fri, 11 May 2012 07:15:00 +0000

In my previous post, “Sentiments of a Singaporean”, one of my readers pointed out whether it is fair to burden taxpayers who are single and do not have children with heavy costs of baby bonuses. Actually before he responded, I already knew where he is coming from. It is human nature to feel sour grape seeing others who have babies receiving monies from the government while you are ineligible . Deep in my heart, I believe this is one reason why policy-makers are so reluctant to give more monies to citizen who are willing to give birth. This is because most of the policy-makers could be either past the child-bearing age or are single and missed the boat to get married. Henceforth, it is perfectly natural that they might feel jealous having to give monies to citizen who are entitled to it. After all, they themselves don’t benefit from it, while …

Should have sold in May and gone away?

AK71 — Mon, 07 May 2012 13:17:00 +0000

In The Straits Times and The Business Times today, there are at least three articles which mentioned “sell in May and go away” and whether it holds any water. Has anyone sold a large part or all of their investments in the last few trading sessions?

Well, today, global stock markets retreated as the Greeks and the French elected new leaders into government. They are sick of austerity measures and they spoke with their votes! European debt story is still very much the key sentiment driver for global stock markets, it would seem.

Asian markets and the euro slumped on Monday after voters in France and Greece voted out their ruling parties in a backlash against austerity measures aimed at battling the eurozone crisis. Read article here: CNA.

I am not an economist. I am not a political scientist. Some issues are definitely beyond me. So, what do I do?

Someone …

Drag!

angel* — Sun, 06 May 2012 10:16:00 +0000

Look at STI Weekly chart and Monthly chart below:

What the 2 charts above tell me:
1. Market has been in such a DRAG! Investors are undecided, BUT
2. Market is at a decision point and a resolution will be coming soon.
Personally, I still am more inclined to think that there is still upside to come because of falling volumes while index stays flat for the past week (which show presence of buyers as sellings were absorbed), I am not really that optimistic.
Market can’t stay flat like this forever, so I guess we can still expect pockets of …

Travel Investing – Beijing, China

Alvin — Tue, 01 May 2012 09:39:26 +0000

Cars

Beijing itself has more cars than the population in Singapore. It currently has over 5 million cars in the city and to my surprise, I saw a lot of European brands like Audi, BMW and Volkswagen running the streets. There were also the familiar Japanese brands like Mazda, Honda and Toyota. The cabs were mainly Hyundai. I noticed that there is always a Chinese company at the back of these imported cars. I suspect the government has made it mandatory for any foreign brand to partner with a local company. Of which, I think FAW Group has the biggest market share (based on what I observed on the roads) – FAW partners with Volkswagen, Audi, Toyota and Mazda.

The traffic is worse than Singapore and there is a restriction to driving on weekdays according to the car plate number. The car plate numbers can end in 10 variations, that …

Who or what can stop this "Penny Cap" rally ?

Kevin Scully — Thu, 26 Apr 2012 06:19:00 +0000

Who or what can stop this “Penny Cap” rally ?
Thursday, 26 April, 2012 2:19 PM
Posted by Kevin Scully

Penny stocks have been dominating the volume on the SGX since February 2012. This is not unusual as we had our blue chip rally from Oct 2011 to Jan 2012 and through normal rotational interest the trading on penny stocks would increase on the back of more positive market sentiment.

The volumes that we have been witnessing on a number of “ultra penny stocks” have been a few hundred million shares per day and would include the likes of MDR, JEL and today Advance SCT. I am writing this short comment after reading the back page of the Straits Times today when more than 1bn JEL shares were traded yesterday. Let me put the 1bn volume yesterday in perspective – according to Bloomberg the issued share base …

Solving the COE Price Escalation Problem

Martin Lee — Tue, 24 Apr 2012 18:25:40 +0000

It was reported that our March inflation figures (measured year on year) was 5.2%. Part of this increase was attributed to a sharper increase in Certificate of Entitlement (COE) prices, which led to higher car prices.

We all know that a declining COE supply had led to a huge increase in the prices of COEs.

Surely there is a better way of improving the current COE system? This is one area that the government can tweak to reduce the cost of living in Singapore.

My friend Chan Tau Chou suggested
implementing some kind of balloting system to control the …

Hunting elephants or rabbits?

brokercalls — Tue, 24 Apr 2012 15:30:41 +0000

Market has not been too good to the blue chips and second-liner stocks recently as the major indices find no catalysts to move higher. STI is still range-bound between 2950 and 3000 while DJIA keep flirting with the 13K level.

There seems to be only two themes in the Singapore market for the past one month and now: churning the micro-penny stocks for potential multi-fold gain (hunting elephants), or stick with defensive high-yield counters (hunting rabbits). Any other categories will likely see prices sliding further or remain stagnant.

My ‘Going for Growth’ portfolio as mentioned in my Mar 19 posting has been disappointing till date, with only CapMalls Asia registering gain (have close this position fully), while OUE remain relatively flat (added more positions).

I have decided to cut loss on the rest and reduced exposure in China Minzhong, due to their deteriorating technical. I reckon there is a better opportunity to re-enter these counters again, on better risk-reward ratio.

On the other hand, my ‘High-yield’ portfolio did pretty well and it reaffirm my belief that this asset class is an excellent option to deliver consistent income and growth to one’s investment portfolio. It is not just buy and hold, but with good trading opportunities to net me some extra gains. (See my earlier post on Trading REITs). Have you bought some CapitaMall Trust at below $1.80 too? Or Ascendas REIT at below $2? What about Mapletree Industrial Trust at $1.09? Sell before they go XD or hold on for the distribution – either way is a win to me.

I am pondering a move on SIA, which is expected to announce their 4Q and full yr result. There seems to be limited downside now and with the management still buying back the shares and market expecting a special dividend (although I am expecting a small one this year instead of the bonanza payout last year amounting to $1.20 per share), it could be a ‘safe bet’.

brokercalls

A full time investors/traders who specialised in Singapore equity market.
Started trading part-time in 1999; turned full-time in 2003.

Mostly suffered losses in the early days of trading, until the breakthrough during the bull-run from 2006-2008. Fortunately, for some prudent money management, the sharp decline in 2008/2009 did little damages to my portfolio and at the same time, presented a great buying opportunity for quality stocks

Stock Market Outlook Going Forward…

James Yeo — Mon, 23 Apr 2012 17:45:00 +0000

If you take a look at these 2 links, read the newspapers about huge capital outflow from BIG funds and coupled with the “Sell in May and go Away” phrase…

http://www.nytimes.com/2012/04/24/business/daily-stock-market-activity.html

http://www.shareinvestor.com/news/news.html?source=si_express&nid=47402

You can jolly well be right to sell away all your holdings now and keep an eye on when you can enter again after the correction has happened.

Another thing to note is the picture below:

Practically all of them (except GoldenAgr) are Penny Stocks worth less than $0.50!!!

The Penny Stock Craze is here but i believe the hike may be ending soon when the entire market shifts direction to the downside. Furthermore, the thing about Penny Stocks is that it is easy to get in but hard to get out especially once the selling comes so quickly!

Conclusion

As for me, i am taking a whole different way …

Weekly Comment on the US and SG market (23/04/2012)

The SG Investor — Mon, 23 Apr 2012 12:36:00 +0000

The Bears’ Checklist

US earning period so far had shown extraordinary results on the major companies’ performances but the this April, the DJIA had been underperforming so far. Even companies which announced good results were met with profit taking rather than appreciation in prices. The market had suddenly decided to give up support for these companies.

Recent US economic data had been mixed while underlying trend still remain positive despite losing some momentum. The question on investors’ mind would be if the effect of QE2 has been over and done with. Fed Reserve also did not introduce QE3.

On the Europe …

The world is sitting on ageing ‘time bomb’

Ivan Guan — Thu, 19 Apr 2012 09:16:19 +0000

One of the news headlines today is The International Monetary Fund (IMF) warns that the World is sitting on ageing ‘time bomb’. The good news, given from the article, is that “we will live longer than we expect”. Ironically, the bad news associated with this is that “we won’t be able to afford it”.

Today, I happened to attend International Adivser Pensions Forum. Although the main topics of the seminar are UK pension and QROPS schemes, a lot of information shown are astonishing and definitely relevant to Singaporeans.

If you read the news paper article today, it says “Richer countries would have to set aside another 50 per cent of their 2010 gross domestic product (GDP) and developing nations, an extra 25 per cent” for the costs of ageing. “Singapore, which has the world’s third-fastest ageing population, it is not likely to be spared.”

You might say: “I’ve …

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